Young children are increasingly raised in families where mothers work, suggesting that parents have less time to invest in children but more income to spend on them. Despite extensive previous research, the effects of parental employment remain uncertain. In addition, it is important examine if accommodations can be made to increase the ability of families to balance the needs of work and home. Parental leave provides a potentially import mechanism for doing so. There has been some study of how parental leave policies affect labor market outcomes but almost no investigation of the effects on children. This project will examine how parental employment during the first years of life affects the well being of children and will extend my on-going investigation of parental leave policies. The following questions will be addressed. Does parental employment during pregnancy affect the receipt of prenatal care, other maternal inputs into fetal development, birth weight, gestational age, or infant health? Does parental employment in the early years of the child's life influence the extent and duration of breast feeding provision of preventive medical care, other maternal into fetal development, birth weight, gestational age, or infant health? Does parental employment in the early years of the child's life influence the extent and duration of breast feeding, the provision of preventive medical care or the quality of home environment? Does parental employment during the first years affect cognitive and socioemotional development or health status during the preschool and early school years? Does the availability or use of parental leave influence the provision of prenatal care, fetal development, child health or cognitive/socioemotional development? Do the results vary by race, ethnicity, education, marital status, previous earnings, or the timing and intensity of parental employment? Special attention will be paid to bias resulting from no -random selection into parental employment or the use of family leave. Three complementary approaches will be used. First, the analysis will use a more comprehensive set of explanatory variables than in any previous research. Second, parental employment will be more carefully modeled. Third, a series of fixed-effect and instrumental variables models will be estimated. In the former, the effects of interest will be identified by differences in parental employment or leave use across siblings or cousins. In the latter, fluctuations in economic conditions (state and federal mandates) will supply a source of exogenous variation in parental employment (leave). This project will also improve on earlier research by examining a wider set of child outcomes and considering the effects of paternal employment.